...VF Brands: Global Supply Chain Strategy Historically, VF had been an apparel manufacturer, so it was proud of the internal manufacturing capabilities and believed that those capabilities offered the company a significant competitive advantage. For VF’s heritage businesses, jeanswear and imagewear, 60% of which production was mainly targeted at the US market. Hence, the company should focus on quick response, rapid replenishment, and low cost. So, VF should take “cut and make” (CM) contracts. In such case, VF stroke separate contracts for suppliers at each stage of the production process and coordinated the flow of product from one supplier to the next one. Therefore, VF could maintain very tight control over costs at each stage and remain total ownership of supply chain. On the other hand, VF used outsourcing for 100% of its lifestyle apparel, footwear, and backpacks. These product lines were acquired by VF recently so their supply chains were more globally diversified. Also, lifestyle brands have very short life cycle, so product design was considered “king”, in these product lines, cost was not a critical issue. There were significant differences in product requirements across regions. For example, jeans were considered as a non-fashion clothing item in the American market, while in Europe, jeans were worn as a fashion clothing item and the prices were much higher than those in America. After taken these factors into consideration, I recommend that VF use the second approach...
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...plants and tanneries, resulting in the planting of more than one million trees in the last ten years, including 300,000 fruit trees in Haiti. Problem solving: Timberland is no stranger to offshore factories. With more than 300 factories in 38 different countries, Timberland exposes itself to a fair amount of environmental uncertainty. However, by spreading their resources in so many developing countries leaves them in a less risky position, as each country possesses its own political, environmental, and financial risk position. Also, Timberland is spreading the risk of pollution and erosion by producing in more than one country. Further research: VF Corporation is an American clothing corporation that sells jean wear, underwear, and work wear. VF Corporation owns Wrangler Jeans, Fruit of Loom, North Face, and 25 more clothing brands that produced over $11 Billion in revenue in 2013. They also own 28 different companies from...
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...competitor had. Instead, he wanted to stay true to their soft drink origin. Their strategy for growth is to go global as aggressively as possible. Mr. Isdell’s strategy was spot on because Coke is a global force in the beverage industry. I know when I lived in Japan, I saw Coke vending machines everywhere! These machines could house both hot and cold beverages! Now that’s an idea to bring to America! With over 80 beverages, Coke offers I forsee them being in the forefront of business in this particular industry. VF Corp CEO Mackey McDonald’s style is more of concentric diversification because his company obtains new companies that are similar to the ones they already own. He also stays true to the brands and doesn’t adhere to the ever-changing fashion trends. They are referred to as lifestyle brands, like Nautica, Vans, North Face, Lee, and Wrangler. As long as those companies keep producing quality products this strategy seems pretty sound. A couple of those brands I currently own and love the quality and...
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...1. Timberland stakeholders would include the owners and the employees from their 300 factories worldwide. Then the stakeholders reach out further to the companies suppliers and their business partners. Also included in the stakeholders list is the government and the local communities where the workers volunteer forty hours per year. Most importantly stakeholders include future generations and the customers. I think Timberland is has an advantage when it comes to the stakeholder map of other companies because they were a family owned company for sixty years. The Swartz family will always be a stakeholder of Timberland 2. Timberland is known as protector of the earth. The competitive advantage given to them by their environmental sustainability because they are more deeply committed to Earthkeeping then any other American country. For example the soles of their boots consist of nearly fifty percent recycled materials. Another example of a successful company technique is how the company gives every employee forty paid hours to go out and volunteer in their community. I think this experience is remarkable because many companies couldn’t afford or care enough to do that for the community. The final example of a success in the environment sustainability is how Timberland has factories in thirty eight countries and with different environmental conditions everywhere Timberland assists their manufacturing partners with improving the land, water, and air around their tanneries and plants...
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...Corporate Strategy Summary Lizeht Robledo University Of Phoenix April 26, 2015 Lastacy Williams Corporate Strategy Summary CEOs have different strategies and plans used in concentration, vertical integration and diversification in the planning function of management. Each of these has a different purpose and is looking for the same results, to keep the company up float. As discussed in this week’s class, the videos in which we need to write this summary have different planning management priorities and skills. Here is what I observed of the different companies we learn about. Southwest Airlines CEO is Gary Kelly is the only CEO who organized and planned a different strategy than all the others. This is why I will explain his strategy first. Mr. Kelly utilizes vertical integration which deals with lower fuel costs. Mr. Gary protects his fuel contracts and monitors prices. By keeping his contracts close and protected so that Southwest Airlines can buy fuel at lower prices. Southwest Airlines are the airlines that pay the lowest cost for fuel. With this fuel contract the Airline can afford to keep their airline fares at very low prices attracting more clients. Because there is a higher middle class population who don’t need luxury, those are the ones who not only afford the prices but also have the interest to travel with fewer expenses in their mind. Anne Mulcahy in the CEO for Xerox. Anne Mulcahy applied the diversification strategy. She applied this strategy...
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...Corporate Strategy Analysis Discussion Summary MGT/230 10/22/2014 Corporate Strategy Analysis Discussion Summary After discussing with the group, we agreed that compassion of the end user and ultimately keeping costs of operation at a low are imperative to maintain a successful company and business. After watching the video about Southwest Airlines CEO, Gary Kelley, the strategies he uses are nearly word for word what we came up with as a group, as stated by the video. He uses a very simple model; “to keep costs down, fly all same planes, 737s, so parts and maintenance are easy, treat customers as kings and queens, and employees even better.” (Businessweek, n.d). He treats his employees like family and friends by asking them about their days and how they are doing. We believe that by not dehumanizing his staff, Kelley is creative a familiar feeling within the company and it helps maintain a lower turnover rate of the staff. That alone is a way Kelley is keeping costs down. The Coca-Cola board brought Nevel Isdel, CEO of Coca-Cola back from retirement. His view was, that instead of “globe-trotting, and introducing Coca-Cola to new markets and countries, it would be more successful to acquire new companies.” Although successful, as a group we felt that this kind of attitude is what initially may have caused the slump in sales for Coca-Cola. The video references how the board of Coca-Cola is hard to work with and had driven away 2 CEO’s before deciding to bring back Isdel...
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...for nearly 50 years their Product Lifecycle has varied. The Product Lifecycle of Vans Shoes now is at the maturity stage, where sales grow at slowing rates and finally stabilize. In this stage, products get differentiated, price wars and sales promotion become common and a few weaker players exit. Growth in the Americas, representing about 70 percent of total revenues in 2011, will account for nearly half of the anticipated $1 billion in revenue growth. With balanced growth across both wholesale and direct-to-consumer channels, a key focus will be expansion outside Vans’ core West Coast market. Major metropolitan areas such as New York City and Mexico City, where Vans has demonstrated great success, will be utilized as epicenters to drive brand awareness. In EMEA (Europe/Middle East/Africa), Vans expects to add $350 million in revenues by 2016. This follows a year of exceptional growth in 2011 when Vans achieved 55 percent constant dollar revenue growth in the region. Building on successful strategic execution in the United Kingdom, Vans outlined how investments in social media, traditional advertising and grassroots events will serve as a catalyst to drive continued growth across Europe. Asia Pacific (APAC) is expected to be Vans’ fastest growth region with its largest opportunity concentrated in China. Accounting for 8...
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...Corporate Strategy Analysis Discussion Shelby Little MGT/230 May 4, 2015 Ronald Sprague Corporate Strategy Analysis Discussion This week the team discussed corporate strategies for the four corporations. We learned what makes these CEO’s the miracle workers they are. I have listed some of the things we discussed and some we did not. Coca Cola This week we discussed how Coca Cola’s CEO was very smart to keep the company a beverage only company. Unlike Pepsico, who has branched out into snacks and fast food, Coca Cola has chosen to merge with other beverage companies. Mr. Isdell chose to find a core group of individuals who wanted to be part of the rebranding of Coca Cola. He made these leaders owners in the corporation. He chose to develop coalitions from the inside out and follow through with them. His stance on productivity was very straightforward and he stood by it. He had an executive talent pool and used these persons as models for the future leaders in the corporation. All of these ideas moved Coca Cola in the forward direction again and has helped make it the company it is today. Xerox Anne Mulcahy became CEO as a suggestion by a former CEO. She had been with the company for many years and held several positions. She made several changes and made cuts without ever affecting the research and development department. Xerox was on the brink of disaster when Anne took over as CEO and she managed to pull them back from the brink and turn a profit. She came...
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...http://www.academia.edu/9339215/CASE_STUDY_OF_THE_NORTH_FACE_INC._AUDITING_ Summary Founded in the mid-1960's by Hap Klopp, The North Face, Inc., was a premier supplier of high-quality hiking, camping, and outdoor gear. In July 1996, North Face's went public. Initially, it sold at $14 per share, then peaked at $30 per share. In March 1999, NASDAQ halted public trading of North Face stock following the company's announcement it would be restating financial statements due to "bad bookkeeping".Christopher Crawford (CFO) boosted company sales by negotiating a barter transaction structured to avoid triggering materiality levels. Result: In May 2000, VF Corporation bought North Face for $2 per share. (Knapp, 2013) Question1 Should auditors insist that their clients accept all proposed audit adjustments, even those that have an "immaterial" effect on the given financial statements? Defend your answer. AnswerforQuestion1: • Auditors should not insist that clients accept all proposed audit adjustments. • Auditors are not perfect and clients should therefore have the right to reject proposed audit adjustments. • If a client does not accept a proposed audit adjustment, the auditor should generally be more suspicious as to the possibility of fraud and misstatement. Question2 Should auditors take explicit measures to prevent their clients from discovering or becoming aware of the materiality thresholds used on individual audit engagements? Would it be feasible for auditors...
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...FACE The North Face is an American outdoor clothing and goods brand formed in west coast San Francisco, 1968, by two hiking aficionados Douglas Tompkins and Kenneth Klopp. The given name references the notion that the north face of a mountain in the northern hemisphere is, by and large, the most difficult to scale. The company specializes in outerwear, footwear and equipment such as backpacks, tents and sleeping bags targeting climbing enthusiasts bound for The Himalayas. However, in the late 90s and early 00s with the emergence of 'wilderness chic' it became all the rage though for most of their fans driving a Range Rover to the ParknShop would be the most strenuous expedition undertaken. Spearheaded by like brands Timberland and UGG, it's audience has widen significantly in the last decade. The North Face's logo was designed by David Alcorn in 1971 and consists of a somewhat skewed quarter-circle with two lines threading within it. This logo is an illustration of Half Dome, a gigantic granitic monolith in Yosemite National Park. As an extra, The North Face is presently a subsidiary of the VF Corporation which is headquartered in Stabio, Switzerland. Other subsidiaries administered by said corporation include Timberland, 7 for all mankind, Wrangler and Vans. The North Face's logo has turned into such a ubiquitous sight on anybody shielding themselves from the cold that it is no real surprise that the brand utterly dominates the outdoor market by quite some way. Globally...
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...The insight that sparks innovation appears to occur randomly. After all, the iconic shorthand for innovation is a light bulb, implying that ideas come from sudden flashes of inspiration. While such flashes are surely good things, it is hard to depend on them, particularly if you are at a company that needs to introduce a steady stream of innovative ideas. Steve Jobs once said, “It is not the customer’s job to know what they want.” That’s absolutely right. It is yours. And don’t think you don’t have a customer because you work in an internal support function or for a company that provides components or services. Everyone has a customer, whether it is a purchaser, user, or co-worker. "More than 50 years ago Peter Drucker wrote, 'The customer rarely buys what the company thinks it sells him.'" The quest to identify opportunities for innovation starts with pinpointing problems customers can’t adequately solve today. More than 50 years ago Peter Drucker wrote, “The customer rarely buys what the company thinks it sells him. One reason for this is, of course, that nobody pays for a ‘product.’ What is paid for is satisfaction.” Companies think they are selling products and services, but in reality people hire those products and services to get jobs done in their lives. As marketing guru Ted Levitt quipped to his students a generation ago, “People don’t want quarter-inch drills--they want quarter-inch holes.” A problem arises, and the customer looks around and chooses the solution...
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...This case talks about the company Levi Strauss and the tough decision CEO, Paul Marineau, had to make back in 2002: whether he should sell his products at Wal-Mart or find another alternative way to make money. In the last five years, Levi-Strauss had lost sales and had to close US plants to move production to cheaper offshore areas. Levi's really needed to revive the brand image to gain back some lost sales and was using marketing to create new advertisements and product placement to broaden their target market. Levi's had tough competition on every level of the price-point spectrum, whether it be high end retailers like Diesel or Calvin Klein, middle vertically integrated retailers like Gap or American Eagles, and on the bottom, private-label brands like Wal-Mart and Target. Levi's had sold to Wal-Mart through a value brand called Brittania in the 1980's and the 1990s, but that came to an end in 1994 over a dispute in Canada about Levi's Orange Tab jeans. After that, sales dwindled for Brittania, and Levi's sold Brittania to VF Corporation. In 2002, however, Levi's was thinking about offering a new value brand to Wal-Mart. It was not that easy of a decision though. They had to think of a way to keep the existing customers in the other channels and not lessen the brand's perceived quality overall. Strategic analysis &; options There are many positives of Levi Strauss selling their products through Wal-Mart, but there is negatives as well. I'll start with the positives first...
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...In 2002, CEO of Levi Strauss, Phil Marineau was faced with a tough decision: whether he should sell product at Wal-Mart. In the last five years, Levi-Strauss had lost sales and had to close US plants to move production to cheaper offshore areas. Levi's really needed to revive the brand image to gain back some lost sales and was using marketing to create new advertisements and product placement to broaden their target market. Levi's had tough competition on every level of the price-point spectrum, whether it be high end retailers like Diesel or Calvin Klein, middle vertically integrated retailers like Gap or American Eagles, and on the bottom, private-label brands like Wal-Mart and Target. Levi's had sold to Wal-Mart through a value brand called Brittania in the 80's and the 90s, but that came to an end in 1994 over a dispute in Canada about Levi's Orange Tab jeans. After that, sales dwindled for Brittania, and Levi's sold Brittania to VF Corp. In 2002, however, Levi's was thinking about offering a new value brand for Wal-Mart. It was not that easy of a decision though. They had to think of a way to keep the existing customers in the other channels and not lessen the brand's perceived quality overall. Overall, the apparel market had been growing steadily since 1998 until 2001, when it dropped 5.7% in dollars from the year before. The total jeans sales accounted for approximately 7% of the total $166 billion made in 2001 with 569 million pairs sold. Experts in the apparel industry...
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...the yoga space. Industry veterans such as Victoria’s Secret and Adidas have entered Lululemon’s market, offering similar products at lower prices. Yet it is still difficult to compare Lululemon to its competitors as the smaller stores are too small and the sporting good giants offer more than one product category (clothes, shoes, sporting equipments) unlike Lululemon. Lululemon has a well defined target market and their performance so far reinforces the fact that the company has a strong ground. Its direct competitors are small businesses that run individual yoga apparel stores and retail stores located in gyms and fitness centers. One example is Dick’s Sporting Goods (DKS), which is a sporting goods retailer that sells both top sports brands’ products (e.g. Nike, Adidas etc.) as well as its own private label product lines, which accounts for 15% of its total sales. On a large scale, Lululemon competes with the sports industry giants Nike and Adidas which are the two largest manufacturers of athletic footwear and apparel in the world, respectively. Both the companies are enormous in terms of sales and market presence in comparison to Lululemon and both have their own stores and their products are carried in a multitude of online and brick-and-mortar stores; in 2008, the revenues for Nike and Adidas were $18.6 billion & $15.6 billion respectively, whereas Lululemon reported revenue of $353.5 million. However, the number for Lululemon has greater significance as it represents an...
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...Thomas Matthew for his valuable guidance and advice. He not only suggested the Country Evaluation & Market entry strategies for the project but also contributed to the various attributes to be added in order to make a successful report. Index | Contents | Page number | 1 | Introduction | 4 | 2 | Country Evaluation | 5 | 3 | Market Entry Strategies- Definitions and Types | 7 | 4 | Joint Venture- Burberry India with Genesis Colors | 8 | 5 | Licensing- Tommy Hilfiger with Arvind VF | 9 | 6 | Franchising- Stuart Weitzman with Reliance Brands | 10 | 7 | Mergers & Acquisitions- LVMH & Gitanjali Jewels | 11 | 8 | Conclusion | 12 | Introduction International expansion for fashion companies presents an opportunity for the multinational companies to expand their growth. This may be due to an increase in the local or international competition in the domestic market for the company. In India the recent relaxation in the entry of FDI for single brand and multi brand retailing have prompted us to re-examine some of the market entry strategies that would be appropriate to enter into a country like India. For this purpose initially we will have to evaluate the market scenario in the country after which we will examine the various market entry modes which the companies in Fashion Industry have used to get into the country. Country Evaluation Before entering into a foreign country multinationals have to take into consideration many things which affect its...
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